Daily Steel produces bars that cost $4 to make, and it receives $7 for them. The difference between these two prices is known as ______.
a. consumer surplus
b. producer surplus
c. deadweight loss
d. price control
b. producer surplus
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Tax increases on business income decrease aggregate demand by decreasing
A) business investment spending. B) government spending. C) consumption spending. D) wage rates.
If the marginal propensity to save is 0.1, then a $10 million decrease in disposable income will
A) increase consumption by $9 million. B) decrease consumption by $1 million. C) increase consumption by $1 million. D) decrease consumption by $9 million.
In the Friedman "Fooling Model" if P(e) is less than P then the labor supply curve in Figure 17-1 above
A) shifts leftward when workers realize their error. B) always shifts rightward. C) initially remains the same. D) Both A and C are correct.
An increase in the equilibrium quantity of good X can be caused by
A) an increase the price of inputs utilized in producing good X. B) an increase in the price of good X. C) a technological improvement in the process of producing good X. D) a reduction in the number of producers of good X.